Office of the State Treasurer

NEWS RELEASE

FOR
IMMEDIATE RELEASENovember 7, 2005

CONTACTS:

Tom
Vincz
(609) 633-6565

Tax Agents and Police
Target Cigarette Sales to Juveniles

TRENTON
-- State Treasurer John E. McCormac and Taxation Division Director Robert
K. Thompson announced today that a Toms River businessman is facing
criminal charges as a result of tax enforcement efforts focusing on
retailers illegally selling cigarettes and cigars to minors.

A
grand jury in Ocean County handed up a four-count indictment against
Richard Carroll, 48, of Brick Twp., N.J., charging him with selling
unstamped cigarettes in violation of the Cigarette Tax Act, a crime
of the fourth degree. Carroll was also charged with filing false or
fraudulent Sales & Use Tax returns and failure to pay or turn over
Sales & Use Tax between January 2001 and December 2004, and with
failure to maintain records as required by both the Cigarette Tax Act
and the Sales & Use Tax acts with the intent to evade tax, all crimes
of the third degree. If convicted, Carroll faces up to 16 years in jail,
fines of up to $55,000.00, and restitution of all tax evaded, with interest.

The
joint investigation at Towne Stationery, 27 Washington St., Toms River,
in June, 2005 by the Division of Taxation’s Office of Criminal
Investigation and the Dover Township Police, also resulted in the seizure
of 80 packs of cigarettes on which New Jersey’s tax of $2.40 per
pack had not been paid, and 173 cigars for which there was no record
of payment of the State’s 30 percent Tobacco Products Tax. The
investigation was opened after Dover Township Police received numerous
complaints that Carroll was selling cigarettes to students of nearby
Toms River South High School. Carroll had previously pleaded guilty
in municipal court to possession of 421 packs of untaxed cigarettes
in May, 2002, and possession of 356 packs of untaxed cigarettes in November,
2002.

Director
Thompson noted that cigarettes and cigars smuggled into the state to
avoid the appropriate taxes are often sold at prices significantly below
the legal fair market price, and are therefore more affordable to high
school students and other minors.

This
case coincides with an initiative ordered by State Treasurer McCormac
to closely monitor cigarette tax law compliance at retail establishments.

New
Jersey has worked in coordination with law enforcement agencies to pursue
vendors who attempt to sell cigarettes illegally and have launched operations
to seize the contraband. During the last fiscal year, 72,838 cartons
of untaxed cigarettes were seized worth a retail value of $4.5 million.
There were 137 court cases involving cigarette taxes, including 125
cases in which contraband cigarettes were seized.

“Taxation’s enforcement agents have begun inspections of
retail establishments frequented by minors to insure that no untaxed
cigarette or cigar products are being sold, and that no sales of single
cigarettes, referred to as ‘loosies,’ are being made,”
said Treasurer McCormac. “It is important for the State to take
steps that combat underage smoking and the sale of untaxed cigarettes
and tobacco products,” he said.

Director
Thompson said any untaxed tobacco products or loose cigarettes will
be seized, and the appropriate charges filed.